Rudi’s View: Key Picks & Sector Favourites

Array
(
    [0] => Array
        (
            [0] => ((QOR))
            [1] => ((GDG))
            [2] => ((PDN))
            [3] => ((HUB))
            [4] => ((LLC))
            [5] => ((GMG))
            [6] => ((CSL))
            [7] => ((360))
            [8] => ((TPW))
            [9] => ((DRO))
            [10] => ((ELS))
            [11] => ((EOS))
            [12] => ((ARF))
            [13] => ((WPR))
            [14] => ((DXC))
            [15] => ((CIP))
            [16] => ((DXI))
            [17] => ((GDF))
            [18] => ((CWP))
            [19] => ((EGH))
            [20] => ((AUB))
            [21] => ((BRG))
            [22] => ((FLT))
            [23] => ((GDG))
            [24] => ((IDX))
            [25] => ((JBH))
            [26] => ((LOV))
            [27] => ((MGH))
            [28] => ((MAD))
            [29] => ((MAQ))
            [30] => ((MP1))
            [31] => ((MND))
            [32] => ((NCK))
            [33] => ((NEU))
            [34] => ((PNI))
            [35] => ((PPT))
            [36] => ((PXA))
            [37] => ((SDR))
            [38] => ((UNI))
            [39] => ((VNT))
            [40] => ((ZIP))
            [41] => ((FLT))
            [42] => ((APE))
            [43] => ((TPW))
            [44] => ((RDX))
            [45] => ((CKF))
            [46] => ((DDR))
            [47] => ((HSN))
            [48] => ((IEL))
            [49] => ((KLS))
            [50] => ((NXT))
            [51] => ((SLC))
            [52] => ((SSM))
            [53] => ((WEB))
            [54] => ((FLT))
            [55] => ((APE))
            [56] => ((ASG))
            [57] => ((IMD))
            [58] => ((SLC))
            [59] => ((GDG))
            [60] => ((MAF))
            [61] => ((NGI))
            [62] => ((COG))
            [63] => ((GDG))
            [64] => ((CGF))
            [65] => ((AMP))
            [66] => ((CPU))
            [67] => ((PPT))
            [68] => ((ASX))
            [69] => ((COL))
            [70] => ((WES))
            [71] => ((HVN))
            [72] => ((EDV))
            [73] => ((DMP))
            [74] => ((ING))
            [75] => ((STO))
            [76] => ((AEL))
            [77] => ((BHP))
            [78] => ((BSL))
            [79] => ((ILU))
            [80] => ((NEM))
            [81] => ((RIO))
            [82] => ((PLS))
            [83] => ((S32))
            [84] => ((NCK))
            [85] => ((ORG))
            [86] => ((QBE))
            [87] => ((IAG))
            [88] => ((SDF))
            [89] => ((NHF))
            [90] => ((SUN))
            [91] => ((MPL))
        )

    [1] => Array
        (
            [0] => QOR
            [1] => GDG
            [2] => PDN
            [3] => HUB
            [4] => LLC
            [5] => GMG
            [6] => CSL
            [7] => 360
            [8] => TPW
            [9] => DRO
            [10] => ELS
            [11] => EOS
            [12] => ARF
            [13] => WPR
            [14] => DXC
            [15] => CIP
            [16] => DXI
            [17] => GDF
            [18] => CWP
            [19] => EGH
            [20] => AUB
            [21] => BRG
            [22] => FLT
            [23] => GDG
            [24] => IDX
            [25] => JBH
            [26] => LOV
            [27] => MGH
            [28] => MAD
            [29] => MAQ
            [30] => MP1
            [31] => MND
            [32] => NCK
            [33] => NEU
            [34] => PNI
            [35] => PPT
            [36] => PXA
            [37] => SDR
            [38] => UNI
            [39] => VNT
            [40] => ZIP
            [41] => FLT
            [42] => APE
            [43] => TPW
            [44] => RDX
            [45] => CKF
            [46] => DDR
            [47] => HSN
            [48] => IEL
            [49] => KLS
            [50] => NXT
            [51] => SLC
            [52] => SSM
            [53] => WEB
            [54] => FLT
            [55] => APE
            [56] => ASG
            [57] => IMD
            [58] => SLC
            [59] => GDG
            [60] => MAF
            [61] => NGI
            [62] => COG
            [63] => GDG
            [64] => CGF
            [65] => AMP
            [66] => CPU
            [67] => PPT
            [68] => ASX
            [69] => COL
            [70] => WES
            [71] => HVN
            [72] => EDV
            [73] => DMP
            [74] => ING
            [75] => STO
            [76] => AEL
            [77] => BHP
            [78] => BSL
            [79] => ILU
            [80] => NEM
            [81] => RIO
            [82] => PLS
            [83] => S32
            [84] => NCK
            [85] => ORG
            [86] => QBE
            [87] => IAG
            [88] => SDF
            [89] => NHF
            [90] => SUN
            [91] => MPL
        )

)

This story features QORIA LIMITED, and other companies.
For more info SHARE ANALYSIS: QOR
The company is included in ASX300, ALL-ORDS and ALL-TECH

Conviction Calls, Best Buys and most favoured sector picks ahead of the February results season.

By Rudi Filapek-Vandyck, Editor

With the February results season approaching rapidly, the focus among local analysts is shifting towards sector updates and reviews of projections and expectations in light of what is likely to be yet another ultra-volatile roller coaster for Australian investors.

This week’s share price responses to market updates by the likes of Qoria ((QOR)) and Generation Development ((GDG)) might well serve as preliminary indicators of what to expect from February in case of imperfection.

It need not only be negative news, of course, as also shown by Paladin Resources ((PDN)) and Hub24 ((HUB)).

Still, it might not be a bad idea to have some cash available.

Wading through the first hundred of pages in previews –and a lot more will be produced before month’s end– a few observations stand out, including:

-ongoing support for the newfound momentum for mining companies (though some valuation criticisms are creeping in)
-mostly cautiously positive views on banks (operationally, not valuations)
-ongoing strong outlooks for engineers and contractors

Among individual companies, the following three updates caught my personal attention this week:

Morgan Stanley suggests Lendlease ((LLC)) might well deliver “a sticker shock” on results day (scheduled for 23 February) with the broker toying with the idea this once great franchise could possibly have zero profit on the books as all major asset sales are due for completion in 2H26, and the first half carries costs associated with the CRU segment.

On the other hand, Goodman Group ((GMG)) is mentioned here and there as potentially in a position to upgrade FY26 EPS guidance, currently set for 9% growth. A recent report by Morgan Stanley suggests the recent establishment of the European data centre JV has provided Goodman with flexibility as to the timing of Development EBITDA.

RBC Capital has highlighted CSL‘s ((CSL)) interim result for a better-than-forecast outcome. No doubt, this will be music to the ears of long-suffering shareholders (which includes myself and the FNArena All-Weather Model Portfolio).

CSL’s interim release is scheduled for the 11th of February. RBC sees revenue and gross profit exceeding consensus forecasts. Earnings estimates have already been lifted and the price target increased to $230.

FNArena’s Corporate Results Monitor includes early updates for the February scheduling (scroll down on the page): https://fnarena.com/index.php/reporting_season/

Below are this week’s fresh updates on sector favourites and Top Picks ahead of next month.
 

Conviction Calls & Best Buys

Analysts at RBC Capital have nominated their two favourite Top Picks among ASX-listed small cap industrial companies:

• Life360 ((360))
• Temple & Webster ((TPW))

The former’s upcoming financial result release in February has the potential to address investor concerns that have kept its share price under pressure since the Q3 market update, or so is RBC Capital’s view.

Regarding the latter, the analysts are reporting industry feedback and data points are indicating online retailers have outperformed throughout the all-important pre- and Christmas sales, and expectations specifically for Temple & Webster have been rebased after the company’s AGM update.

****

Bell Potter is retaining a positive view on Droneshield ((DRO)), Elsight ((ELS)), and Electro Optic Systems ((EOS)) –all three rated Buy– irrespective of the observation that share prices have almost literally taken off since December.

The broker sees a catalyst rich next six months while valuation multiples remain below that of global peers.

Shares in Droneshield are still recovering from last year’s PR debacle, while the other two shares are trading at or near all-time record highs.

****

Today’s freshly released sector update on AREITs by Moelis is characterised by a positive undercurrent irrespective of potential rate hikes by the RBA in the year ahead.

Moelis likes:

1.) Rent collectors with relatively long WALEs & defensive business models: These REITs are trading at discounts to NTA and historical ranges and have balance sheets with capacity to grow earnings.

• Arena REIT ((ARF))
• Waypoint REIT ((WPR))
• Dexus Convenience Retail REIT ((DXC))

2.) Discounted industrial REITs: Industrial rents in most markets are no longer experiencing material growth and large warehouses are now typically experiencing extended downtimes upon expiry.

• Centuria Industrial REIT ((CIP))
• Dexus Industria REIT ((DXI))
• Garda Property Group ((GDF))

3.) Residential developers with earnings growth potential trading at undemanding multiples: Developers with exposure to QLD, WA residential markets set to benefit the most, with VIC slated for an eventual recovery over the next two years.

• Cedar Woods Properties ((CWP))
• Eureka Group Holdings ((EGH))

****

From the Quant desk at Macquarie comes the following list of Best Picks among small and midcap ASX-listings:

• AUB Group ((AUB))
• Breville Group ((BRG))
• Flight Centre ((FLT))
• Generation Development ((GDG))
• Integral Diagnostics ((IDX))
• JB Hi-Fi ((JBH))
• Lovisa Holdings ((LOV))
• Maas Group ((MGH))
• Mader Group ((MAD))
• Macquarie Technology ((MAQ))
• Megaport ((MP1))
• Monadelphous ((MND))
• Nick Scali ((NCK))
• Neuren ((NEU))
• Pinnacle Investment Managers ((PNI))
• Perpetual ((PPT))
• Pexa Group ((PXA))
• SiteMinder ((SDR))
• Universal Store Group ((UNI))
• Ventia Group ((VNT))
• Zip Co ((ZIP))

The above selection is the outcome from combining best picks chosen by Macquarie analysts with the two investment styles of Quality and undervalued pricing (Fundamental Value).

****

Traditionally, analysts at Morgan Stanley nominate their Key Ideas ahead of the upcoming results season. Have been nominated so far:

• Flight Centre ((FLT))
• Eagers Automotive ((APE))
• Temple & Webster ((TPW))
• Redox ((RDX))

****

UBS analysts’ Top Picks among emerging companies ahead of February:

Key Picks:

• Collins Foods ((CKF))
• Dicker Data ((DDR))
• Hansen Technologies ((HSN))
• IDP Education ((IEL))
• Kelsian Group ((KLS))
• NextDC ((NXT))
• Superloop ((SLC))
• Service Stream ((SSM))
• Web Travel Group ((WEB))

Noteworthy mentions:

Positive tone – Flight Centre ((FLT))
Cautious tone – Eagers Automotive ((APE)).

Stocks where UBS analysts see double positive risk to result and outlook:

• Autosports Group ((ASG))
• Imdex ((IMD))
• Superloop ((SLC))

****

Stockbroker Morgans‘ key sector picks among financial services providers are, in order of preference:

• Generation Development ((GDG))
• MA Financial ((MAF))
• Navigator Global Investments ((NGI))
• COG Financial Services ((COG))

****

Peers at Citi have published their own order of preference for diversified financials:

• Generation Development ((GDG))
• Challenger ((CGF))
• AMP ((AMP))
• Computershare ((CPU))
• Perpetual ((PPT))
• ASX ((ASX))

****

Macquarie has identified three Key Picks among consumer-related companies on the ASX:

• Coles Group ((COL)), for margin resilience
• Wesfarmers ((WES)), for its quality
• Harvey Norman ((HVN)), for exposure to furniture sales

Key stocks to Avoid:

• Endeavour Group ((EDV)) due to further margin downside
• Domino’s Pizza ((DMP)) due to ongoing store profit risk
• Inghams Group ((ING)) due to oversupply

Over at the broker’s Energy desk, the view remains that an underweight portfolio allocation to the sector remains most apposite.

Within this context, the broker’s two sector favourites are Santos ((STO)) and Amplitude Energy ((AEL)).

****

Morgan Stanley‘s core view is the rotation into Resources has much further to run (and global portfolios are not yet adjusted for it).

Within this context, the broker’s Model Portfolio includes exposure to:

• BHP Group ((BHP))
• BlueScope Steel ((BSL))
• Iluka Resources ((ILU))
• Newmont Corp ((NEM))
• Rio Tinto ((RIO))
• PLS Group ((PLS))
• South32 ((S32))

On the broker’s assessment, the past six months has shown the largest Resources outperformance since 2009.

In Australia, Resources are now a larger index weight than the banks.

****

Nick Scali ((NCK)) is Citi’s key small cap housing retail pick.

****

Origin Energy ((ORG)) remains UBS’s most preferred ASX-listed Utilities exposure.

****

Citi’s order of preference for insurance sector exposure is QBE Insurance ((QBE)), then Insurance Australia Group ((IAG)), Steadfast Group ((SDF)), nib Holdings ((NHF)), Suncorp ((SUN)) and Medibank Private ((MPL)) last.

Do make sure you also read:

https://fnarena.com/index.php/2026/01/15/rudis-view-pre-february-top-picks-favourites/

https://fnarena.com/index.php/2025/12/24/rudis-view-best-buys-favourites-for-2026/

(Do note that, in line with all my analyses, appearances and presentations, all of the above names and calculations are provided for educational purposes only. Investors should always consult with their licensed investment advisor first, before making any decisions.)  

P.S. I – All paying members at FNArena are being reminded they can set an email alert for my Rudi’s View stories. Go to My Alerts (top bar of the website) and tick the box in front of ‘Rudi’s View’. You will receive an email alert every time a new Rudi’s View story has been published on the website. 

P.S. II – If you are reading this story through a third party distribution channel and you cannot see charts included, we apologise, but technical limitations are to blame.

FNArena Subscription

A subscription to FNArena (6 or 12 months) comes with an archive of Special Reports (20 since 2006); examples below.

Find out why FNArena subscribers like the service so much: “Your Feedback (Thank You)” – Warning this story contains unashamedly positive feedback on the service provided.

FNArena is proud about its track record and past achievements: Ten Years On

Click to view our Glossary of Financial Terms